Organic Food Market: The COVID-19 pandemic has heightened awareness regarding the significance of health, wellness, and nutrition among individuals. Organic food is recognized for being free from pesticides and is celebrated for its nutritional advantages, absence of harmful substances, and its role in enhancing immunity.
Organic Food Market
India’s organic food sector has experienced remarkable growth following the pandemic. A 2022 survey conducted across 187 countries engaged in organic agriculture, utilizing data from the Research Institute of Organic Agriculture (FiBL) and the International Federation of Organic Agriculture Movements (IFOAM), indicates that organic farming in India spans 2.6 million hectares, making it the fifth largest globally. (Organic Food Market) The report also highlighted that organic farming accounts for 1.5% of the total agricultural land, with a significant increase of 145.1% in organic cultivation over the past decade. According to the Economic Survey 2022-2023, India boasts 4.43 million organic farmers, the highest number in the world.
According to the Agricultural and Processed Food Products Export Development Authority (APEDA), part of the Ministry of Commerce & Industries, Government of India, India generated approximately 2.9 million metric tons of certified organic products in the 2022-23 period. This production encompasses a wide range of food items, including oilseeds, fibers, sugarcane, cereals and millets, cotton, pulses, aromatic and medicinal plants, tea, coffee, fruits, spices, dried fruits, vegetables, and processed foods. Additionally, the production extends beyond consumables to include organic cotton fiber and functional food products.
Madhya Pradesh stands out as the leading producer among various states, with Maharashtra, Rajasthan, Karnataka, and Odisha following in succession. (Organic Food Market) When examining the types of commodities, fiber crops represent the largest segment, succeeded by oil seeds, sugar crops, cereals and millets, medicinal/herbal and aromatic plants, spices and condiments, fresh fruits and vegetables, pulses, as well as tea and coffee.
The Opportunities within India’s Organic Food Market
To promote and enhance the growth of the Organic Food Sector in India, the Government of India has implemented various initiatives.
1. Paramparagat Krishi Vikas Yojana (PKVY): Introduced in 2015, this program plays a crucial role in Soil Health Management (SHM) as part of the Centrally Sponsored Scheme (CSS) under the National Mission on Sustainable Agriculture (NMSA). (Organic Food Market) The primary objective of PKVY is to support and promote organic farming, which ultimately contributes to the enhancement of soil health.
The initiative encourages organic farming by implementing the organic village by cluster approach, which requires a minimum area of 20 hectares, alongside the Participatory Guarantee System (PGS) for India. This form of organic certification actively engages both producers and consumers in the certification process. PGS-India serves as a locally relevant quality assurance program that prioritizes stakeholder involvement and functions independently of third-party certification frameworks.
Financial support of INR 50,000 per hectare is allocated to farmers for a duration of three years. As of November 16, 2022, the PKVY initiative has encompassed 32,384 clusters, covering a total area of 640,000 hectares and benefiting 1.61 million farmers. Furthermore, eight states have established their own brands for organic products. (Organic Food Market) To date, a total of INR 1,854.01 crore has been disbursed under this scheme for the fiscal year 2022-23. Since its inception in 2015-16, the program has facilitated the transition of 1.185 million hectares to organic farming, with plans to convert an additional 600,000 hectares to organic practices through PKVY from 2022-23 to 2025-26.
Organic Food Market: The government has launched a Large Area Certification (LAC) program since the 2020-21 period, aimed at recognizing Traditional Organic Areas such as hills, islands, tribal regions, and desert belts that have no prior exposure to genetically modified organisms (GMO) or agrochemicals. The objective is to develop these areas into certified organic production centers. Notably, 14,491 hectares in the Car Nicobar and Nancowry group of islands within the Andaman & Nicobar Islands have received certification, marking this region as the first extensive contiguous area to achieve organic certification under the LAC initiative.
2. Mission for the Development of the Organic Value Chain in the North East Region (MOVCDNER). : The initiative, which commenced operations in 2015-16 as a sub-mission of the National Mission on Sustainable Agriculture (NMSA), is designed to establish organic value chains specific to various crop commodities. It seeks to tackle deficiencies in organic crop production, wild crop harvesting, organic livestock management, and processing, among other areas.
Organic Food Market: Since the 2015-16 period, the MOVCDNER initiative has facilitated the adoption of organic farming across an area of 1.73 lakh hectares by establishing 379 Farmers Producers Organisations (FPOs) and Farmers Producers Companies (FPCs), engaging a total of 1.89 lakh farmers. Furthermore, seven northeastern states have created their own brands for organic products. To date, a total of INR 919.42 crore has been allocated under this scheme.
Under the MOVCDNER initiative, farmers receive financial support of INR 10,000 per hectare for a duration of three years, which covers training, guidance, and the documentation of Integrated Crop Systems (ICS). (Organic Food Market) Additionally, they are granted assistance of INR 32,500 per hectare over the same three-year period for both off-farm and on-farm organic inputs. The scheme also offers need-based assistance for various components.
3. Jaivik Kheti organic e-commerce portal: The Ministry of Agriculture and Farmers Welfare, in collaboration with MSTC, establishes a direct connection between farmers and both retail and bulk purchasers. This portal serves as a knowledge hub, featuring case studies, videos, and best practices in farming. It also connects various stakeholders, including regional councils, local organizations, individual farmers, buyers, government bodies, and input suppliers, to foster the comprehensive development and promotion of organic farming.
4. The National Programme for Organic Production (NPOP): APEDA oversees the accreditation of Certification Bodies, establishes standards for organic production and packaging, and promotes organic farming and marketing initiatives. As a result of the recognition granted by accredited certification bodies in India, Indian organic products are accepted in international markets.
5. Production Linked Incentive Scheme for Food Processing Industry (PLISFPI): The Union Cabinet granted approval on March 31, 2021, for a budget of INR 10,900 Crores to be allocated for the implementation of the Scheme from 2021-22 to 2026-27. This initiative aims to foster the development of global food manufacturing leaders. The second component of the Scheme includes provisions for innovative and organic products from small and medium enterprises (SMEs), specifically covering Free Range Eggs, Poultry Meat, and related egg products. (Organic Food Market) To further enhance industry growth, the regulations regarding minimum sales and required investments do not apply to entities chosen for producing innovative or organic products. To date, 14 applications have been approved in this category.
6. Assistance for organic and bio-inputs within the nation. : Various initiatives, such as the Bhartiya Prakritik Kheti Bio-Input Resource Centres, the PM Programme for Restoration, Awareness, Nourishment, and Amelioration of Mother Earth (PM-PRANAAM), and the Galvanizing Organic Bio-Agro Resources Dhan (GOBARdhan) scheme, are promoting the use of organic fertilizers among farmers.
7. Various initiatives,: such as the promotion of Indian millets, the implementation of Geographical Indication (GI) tags, and campaigns like “Vocal for Local,” are contributing to the increased consumption of organic foods across the nation.
Final Thoughts.
Organic Food Market: In 2021, the combined initiatives of the government led to India’s organic product exports exceeding $1 billion, with the United States accounting for 54% of these exports. Organic processed foods emerged as the leading category within this sector. Following the U.S., the European Union and Canada were significant markets for these exports. (Organic Food Market) It is important to highlight that in 2020, the estimated value of India’s organic products market was $815 million. Nevertheless, there remains substantial potential for growth, as the global market is valued at over $133 billion.
The US Department of Agriculture projects that the market for organic products in India, which includes food and beverages, health and wellness, (Organic Food Market) beauty and personal care, and textiles, is expected to reach $10.1 billion by 2026.